Retail inflation edges up to 22-month high of 5.77 per cent

Retail inflation inched up to a 22-month high level of 5.77 per cent in June on increase in food prices including that of key kitchen staples like vegetables and cereals.

With inflation remaining at an elevated level and above the 5 per cent mark, Reserve Bank’s next monetary policy review in August would be keenly watched as inflation targetting has been the main objective of the apex bank.

The retail inflation measured on Consumer Price Index (CPI) was marginally lower at 5.76 per cent in the previous month, while it was 5.40 per cent in June last year.

In August 2014, consumer inflation was at 7.8 per cent. The overall food inflation moved up to 7.79 per cent in June from 7.47 per cent in the previous month, a government data showed today.

Inflation in vegetables was up at 14.74 per cent against 10.77 per cent in May and in cereals and related products was 3.07 per cent compared to 2.59 per cent in the previous month.

However, the rate of price rise in pulses declined to 26.86 per cent during the month while it stood at 31.57 per cent in May. Protein rich items, like meat, fish, eggs, milk saw a marginal decline in comparison to May.

Inflation in fuel and light basket was 2.92 per cent in June as against 2.94 per cent in the previous month.

The Ministry of Statistics and Programme Implementation collects data from selected towns and villages to calculate CPI-based retail inflation.

In its bi-monthly policy released last month, RBI had maintained status quo in key policy rate citing higher upside risks to ‘inflation trajectory’.

The retail inflation in rural areas was at 6.2 per cent and in urban areas it was 5.26 per cent in June, showed the data.